Dear New Frugal You,
I'm
in real trouble. I've been living on the edge for months. Just barely able to
pay my bills. Don't spend anything on myself. Now, last week my boss cut my
hours. I'm really stressed out. What can you do when you've already cut your
budget to the core? -- Brooke

Dear Brooke,
If
you've followed the news lately, you've seen the headlines and know you're not
alone. Because of the economy or concern about the costs of covering full-time
employees under the new health care law, a number of companies are reducing the
hours of their employees.

That
can be a serious problem, especially for people like you who are already living
on the edge financially. Let's see if we can't find some frugal answers for
you.

The
first and probably most important step is to have good info on how much you're
currently spending and what your new income will be. You need to know how much
you're short.

Once
you know how big a gap you're trying to close, you can begin the hunt for
dollars. We'll look at ideas from the simplest to the more severe.

Expenses: Take a fresh lookStart
by taking another look at your current expenses. You've already cut the easy
stuff. This time you'll have to go deeper. It's time to eliminate any expense
that doesn't feed you, heal you, put a roof over your head or make it possible
to earn an income.

Get
creative! Try to look at each expense with fresh eyes. Don't skip anything just
because you don't think you can live without it. Make sure that's really true.

Spend
some time searching online for solutions that are new to you. For example, have you
ever visited a "salvage" grocery store? They often deal in overstock items or
products in dented cans. Or
try visiting a bakery outlet. Stop there before you hit your local grocery
store.

Groceries
are an excellent place to look for savings. Most families spend between 10 percent and
20 percent of their take-home pay on food. Plus you make purchasing decisions
almost daily. That means that your food budget offers many opportunities to
save.

Plan
on eating and preparing all your meals at home. On average, people spend about
40 percent of their food budget on food prepared outside their home. You
can have a steak dinner at home or you could
make your own burger for a fraction of the cost. The same thing is true of any
restraurant or takeout.

Home cooking
Cook
as much from scratch as possible. Basic food items aren't that expensive, but
if you're buying food that you just pop into the oven or microwave you'll pay
top dollar. Eliminate single serving and convenience items.

Collect
some frugal recipes. Even with grocery prices that seem to go up each week, you
can still make some meals that are nutritious and frugal. Often the trick is
limiting the amount of meat and sticking to staples.

Cooking
isn't as hard or time-consuming as you might think. There are many resources
online that can teach you. Doing your own cooking will save you money every
time you prepare a meal.

Learn
to buy and use fruits and veggies in season. We've grown accustomed to having the
produce we like available year-round. But when it's out of season locally that
means that it must be shipped in and the prices reflect that. Let your diet
change seasonally. Take advantage of the food items that are grown in abundance
locally.

Look
for ways to avoid purchases of all types, especially things that you'll only
use a few times a year. It's easy to fill your garage with things such as carpet
scrubbers and wood chippers that you can borrow from a neighbor. Offer to pay
them a few dollars for the rental and you'll be doing them a favor, too.

You
may find that paring your food budget to the bone, eliminating entertainment,
clothing and other smaller expenses aren't enough to get to your goal. Then
you'll need to be prepared to make bigger sacrifices. Changes that could have a
major impact on your lifestyle.

Search more widely for help, extra income
Before
you consider deeper cuts, you'll want to see if either government assistance or
a part-time job could help.

A
reduction in your hours might make you eligible for a partial unemployment
benefit. Check with your unemployment office. Also, find out about food stamps.

Don't
be afraid to take on part-time work. It might take a bit of schedule juggling,
but it's not like you're not used to working more hours. And, having an extra
source of income could be really helpful if the cutbacks aren't temporary.

Finally,
you might find that the only thing that can save you is a serious lifestyle
adjustment. You may find that you need to move to cheaper housing, take in a
roommate or sell your car. Those aren't easy choices, but they can provide
serious monthly savings.

I hope the reduction in hours will be temporary, and you'll find making up the
shortfall will be easy. But, don't go in with that assumption. The economy
looks dicey and you'd be wise to be prepared for the longer haul.

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Published: November 29, 2012

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